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Toys prove to be better investment than gold, art, and financial securities – Phys.Org

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Unusual ways of investment, such as collecting toys, can generate high returns. For example, secondary market prices of retired LEGO sets grow by 11% annually, which is faster than gold, stocks, and bonds, HSE University economists say. Their paper was published in the Research in International Business and Finance journal.

According to a survey by Barclays, rich people invest about 10% of their wealth in jewelry, art, antiques, collectible wines, and cars (in addition to traditional investment in financial securities). Demand for such goods is particularly high (as is growth in their ) in developing countries, such as China, Russia, and Middle Eastern countries. These alternative investments are well-studied, unlike more unusual goods whose purchase might seem less serious: LEGO sets, Barbie dolls, superhero minifigures, or model cars and trains.

Victoria Dobrynskaya, one of the study’s authors and Associate Professor at the Faculty of Economic Sciences

‘We are used to thinking that people buy such items as jewelry, antiques or artworks as an investment. However, there are other options, such as collectible toys. Tens of thousands of deals are made on the secondary LEGO market. Even taking into account the small prices of most sets, this is a huge market that is not well-known by traditional investors.’

There may be several reasons for the rapid growth in the price of the sets. First, they are produced in limited quantities, particularly special collections dedicated to iconic films, books, or historic events. Second, after sets are retired, the number of them available on the secondary market is not large: many owners don’t see value in them (and lose or toss parts), while others, on the contrary, value them and don’t want to sell them. Third, LEGO sets have been produced for several decades and have a lot of adult fans. It would be reasonable to assume that the more time has passed since the set was manufactured, the more it would be valued as a classic sample or a nostalgic object. However, there had been no academic studies to substantiate this assumption.

The authors of the paper looked at the prices of 2,322 LEGO sets from 1987-2015. The dataset included information on primary sales and online auction transactions (only sales of new unopened sets were selected). Secondary market prices usually start to grow two or three years after a set is retired, but there is a significant variation in returns ranging from -50% to +600% annually. Prices of small and very big sets grow faster than prices of medium-sized ones, probably because small sets often contain unique parts or figures, while big ones are produced in small quantities and are more attractive to adults. Prices of thematic sets dedicated to famous buildings, popular movies, or seasonal holidays tend to experience the highest growth on the secondary market (the most expensive ones include Millennium Falcon, Cafe on the Corner, Taj Mahal, Death Star II, and Imperial Star Destroyer). Another attractive category includes sets that were issued in limited editions or distributed at promotional events: rarity increases their value from the collectors’ perspective.

Average returns on LEGO sets are 10-11% annually (and even higher if the new set was purchased on the primary market with a discount), which is more than stocks, bonds, gold, and many collectible items, such as stamps or wines, yield.

In addition, LEGO prices are weakly dependent on the stock market (they were growing even during the financial crisis of 2008) and are relatively low in comparison to art, antiques, and cars, which makes them a reliable and accessible method of investment. However, the authors of the study say that investment in LEGO is worthwhile only in the long term (i.e., over three years) and incurs higher transaction costs (e.g., delivery and storage) than investment in financial securities.

‘Investors in LEGO generate high returns from reselling unpacked sets, particularly rare ones, which were produced in limited editions or a long time ago. Sets produced 20-30 years ago make LEGO fans nostalgic, and prices for them go through the roof. But despite the high profitability of LEGO sets on the secondary market in general, not all sets are equally successful, and one must be a real LEGO fan to sort out the nuances and see the investment potential in a particular set,’ Victoria Dobrynskaya said.


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Investment in LEGO can yield returns of up to 600 percent


More information:
Victoria Dobrynskaya et al, Lego: The Toy Of Smart Investors, Research in International Business and Finance (2021). DOI: 10.1016/j.ribaf.2021.101539

Provided by
National Research University Higher School of Economics

Citation:
Toys prove to be better investment than gold, art, and financial securities (2021, December 3)
retrieved 3 December 2021
from https://phys.org/news/2021-12-toys-investment-gold-art-financial.html

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Major Value-Added Agriculture Investment Announced in Saskatchewan | News and Media – Government of Saskatchewan

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Released on January 17, 2022

FCL To Build Canola Processing Plant And Canada’s Largest Renewable Diesel Facility In Regina

Today, Federated Co-operatives Limited (FCL) announced its plans to develop an Integrated Agriculture Complex (IAC) north of the Co-op Refinery Complex in Regina.  The IAC will include a renewable diesel facility, as well as a new canola crushing plant in partnership with AGT Foods.

The FCL renewable diesel production plant alone represents a nearly $2 billion investment for the province and is expected to create more than 2,500 construction jobs and 150 permanent operating jobs.  The entire IAC is estimated to have direct and indirect economic benefits of approximately $4.5 billion.

“This is a tremendous opportunity for Saskatchewan and for FCL and AGT Foods that will bolster the sustainability and economic goals of these companies and the province,” Premier Scott Moe said.  “Our province has the food, fertilizer, and fuel the world needs, including renewable energy from canola grown and processed here, which speaks to the heart of our plan for economic recovery and growth as we work to build an independent, strong and sustainable Saskatchewan.”

The FCL-AGT canola crushing facility will ensure Saskatchewan exceeds its 2030 Growth Plan goal of processing 75 per cent of the canola grown in the province.  It also supports the Growth Plan goal of increasing agriculture value-added revenue to $10 billion.

The FCL renewable diesel plant will have a production capacity of 15,000 barrels per day, or about 1 billion litres per year. The FCL-AGT canola crush facility will use 1.1 million tonnes of canola seed to produce 450,000 tonnes of oil, supplying approximately 50 per cent of the feedstock required for the renewable diesel plant, with the remainder of the supply being contracted from other canola crush facilities.

“We know the synergies between transportation fuel production and agriculture will play a vital role in Western Canada’s transition to the low carbon economy,” FCL CEO Scott Banda said.  “We believe our Co-op Retailing System is well-positioned to integrate and capture the full agricultural value-chain in the production of fuel and value-added products.  We are excited about our partnership with AGT and ultimately what this announcement means for value-added agriculture in our province.”

With facilities and outlets in 249 communities in Saskatchewan, FCL and local co-ops employ more than 10,000 workers across the province.

-30-

For more information, contact:

Robin Speer
Trade and Export Development
Regina
Phone: 306-519-5006
Email: robin.speer@gov.sk.ca

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Cross-border investment surged in November – Investment Executive

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The cross-border activity was concentrated on debt securities, with foreign investors adding $31.4 billion worth in the month, up from $20.4 billion the previous month.

StatsCan reported that investors targeted federal debt — adding $8.6 billion in bonds and $6.5 billion worth of money market securities — along with $9.8 billion in corporate debt.

Conversely, foreign investors trimmed $1.3 billion worth of Canadian equities in the month.

“The reduction reflected retirements of Canadian portfolio shares resulting from cross-border merger and acquisition activities. Foreign purchases of Canadian shares on the secondary market, led by shares of chartered banks, moderated the overall reduction,” StatsCan said.

At the same time, Canadian investors ramped up their buying of foreign securities in November.

In total, domestic investors added $17.5 billion in foreign securities, StatsCan reported. This was up from $5.4 billion in October.

Canadian investors jumped into U.S. stocks in November, buying $7.4 billion worth of equities, up from just $652 million in October. Large-cap tech stocks and index funds were the primary targets, StatsCan said.

Additionally, investors bought $4.0 billion worth of non-U.S. foreign shares in November, reversing a $2.5-billion divestment in October.

Canadian investors also added $6.1 billion in foreign debt, including $2.8 billion in U.S. corporate bonds and $1.6 billion in U.S. government bonds.

In a research note, National Bank Financial Inc. (NBF) said November’s $17.5-billion net investment means Canadian investors acquired $144.4 billion worth of foreign securities during the first 11 months of 2021.

“In dollar terms, you won’t find a prior [year-to-date] tally remotely close,” NBF said, noting that the previous record was $73.3 billion about 15 years ago.

Even with the record flow into foreign securities, net portfolio flows are still positive for Canada, as foreign buying of Canadian securities has been even stronger.

“An improved current account means Canada is less reliant on foreign inflows,” NBF said. “Still, the apparent abandonment of Canada by domestic investors is part of an overall capital bleed that needs redressing.”

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4 Must-Have TFSA Stocks for Any Investment Goal – Yahoo Canada Finance

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Written by Amy Legate-Wolfe at The Motley Fool Canada

If you have a Tax-Free Savings Account (TFSA), then you hopefully have an investment goal to go along with it. Now, we could drill down into specific savings goals, but, honestly, those goals change! What someone wants at 30 will be different at 50, and so on. First, it’s student debt, then a house, then a child, their education, and, of course, retirement.

Frankly, you shouldn’t have to juggle your investments every time you come up with a new goal. In fact, one of the main points of investing is to buy and hold for as long as you can. Sure, you can take out cash as your goals come in, but you should be able to hold onto them for as long as you want.

With that in mind, here are four TFSA stocks that will help you achieve any investment goal.

Fortis

If you’re going to have long-term TFSA stocks, you need stable companies to get you there. That would definitely include Fortis (TSX:FTS)(NYSE:FTS). The utility company has been growing its dividend each year for almost 50 years. This comes from a stable business plan of growth through acquisition.

Investors have been flocking to Fortis as one of the TFSA stocks they want because of this stability — especially during the market pullback. The company is basically recession proof, providing gas and electric utilities to 3.4 million customers. You need the lights on no matter what, making it a strong choice for any investor.

Fortis shares are up 16% in the last year with a dividend yield of 3.63%.

TD Bank

The Big Six banks may be trading at all-time highs, but there’s a reason. And that reason is why they’re TFSA stocks for any investment goal. The banks managed to get out of the market drop relatively unscathed, and yet they still have so much cash on hand to make up for lost time. And that comes through solid dividend jumps.

But Toronto-Dominion Bank (TSX:TD)(NYSE:TD) has even more to offer. TD stock offers the most growth of the Big Six banks, with the most amount of credit card partnerships, growing online and United States presence, and the most loan options for solid revenue streams. And yet even after all this growth, TD stock still trades at just 13.42 times earnings.

TD stock is up 41% in the last year, with a dividend yield of 3.47%.

Constellation Software

If you have the cash to invest, Constellation Software (TSX:CSU) is one of the few tech stocks that remains a stable investment. The company has been an acquisition powerhouse, identifying the software companies it believes will thrive with incredible expertise.

It’s those experts that have managed to keep the company growing at a stable clip, even as other tech stocks burn around it. Constellation shares have been steady as a rail, growing through venture funds and seeing revenue rise 30% year over year during the last quarter. It’s one of the TFSA stocks any investor should add as soon as possible before it rises even more.

Shares of Constellation are up 34% in the last year, and it recently boosted its dividend to offer a yield of 0.24%.

Nutrien

Finally, Nutrien (TSX:NTR)(NYSE:NTR) may be on the newer side, but don’t count this out among TFSA stocks. People need to eat, and Nutrien is now the world’s largest crop nutrient provider. As arable land decreases and climate change increases, Nutrien will be a necessity for any portfolio.

Nutrien continues to grow through acquisition. In the last few years, it has increased its digital presence at an incredible rate. This kept revenue coming in at an incredibly important time — for the company and farmers. Now, it’s nearing the three-digit mark and isn’t likely to come down.

Shares of Nutrien are up 37% in the last year, with a yield of 2.57% for investors.

The post 4 Must-Have TFSA Stocks for Any Investment Goal appeared first on The Motley Fool Canada.

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Fool contributor Amy Legate-Wolfe owns TORONTO-DOMINION BANK. The Motley Fool recommends Constellation Software, FORTIS INC, and Nutrien Ltd.

2022

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